Help, harm or avoid? On the personal advantage of dispositions to cooperate and punish in multilateral PD games with exit

Simulated round-robin tournaments are used (1) to assess the relative perfo rmance of non-defecting, conditionally cooperative programs in a three-pers on PD setting where exit is possible (PDEs) and (2) to assess the importanc e of sanctions for the success of joint enterprises. We find that the possi bility of exit allows individuals to escape from dysfunctional teams which increases the potential benefits: of cooperation while reducing those assoc iated with free-riding. We also find that punishment, especially targeted p unishment, is critical to the success of shorter term enterprises. Similar results held in evolutionary settings where successful behavioral programs can be imitated, or propagated by non-rational biological or social process es. Our results suggest that non-defecting programs of conditional cooperat ion can be rational, average payoff maximizing, strategies for participatin g in small multilateral settings where individuals can choose to participat e in a PD game or not. (C) 2001 Elsevier Science B.V. All rights reserved. JEL classification: C7; D6; A13.